Welcome to the Arizona Real Estate Licensing Exam preparation guide. This comprehensive test bank
contains 450 practice questions designed to mirror the actual exam format and difficulty. The Arizona
real estate exam is a critical step toward obtaining your license and beginning your career in one of the
nation's fastest-growing real estate markets. The exam tests your knowledge of both national real estate
principles and Arizona-specific laws, including agency relationships, contracts, property rights, financing,
valuation, fair housing, and ethics. This practice test bank provides detailed rationales for every answer,
helping you understand the "why" behind each concept. Use these questions to identify your strengths
and weaknesses, build confidence, and ensure you are fully prepared to pass the exam on your first
attempt. Success requires dedicated study, understanding of Arizona statutes, and mastery of real
estate math and vocabulary. Good luck on your journey to becoming a licensed Arizona real estate
professional!
QUESTION 1
Which method of ownership is NOT legal in Arizona?
1) joint tenancy WROS
2) severalty
3) tenancy by the entirety
4) tenants in common
Correct Answer: 3) tenancy by the entirety
Rationale: Tenancy by the entirety is a form of ownership that is only available to married couples in
some states, but Arizona does not recognize this form of co-ownership. Arizona allows joint tenancy
with right of survivorship, severalty (sole ownership), and tenants in common. The key distinction is that
Arizona is a community property state, and tenancy by the entirety conflicts with community property
laws.
Page | 1
,QUESTION 2
Tim's Arizona City Residential property has an assessed value of $43,500 and the tax rate is 4%. What is
Tim's tax bill?
1) $919.50
2) $1,087.50
3) $1,740.00
4) $3,480.00
Correct Answer: 3) $1,740.00
Rationale: To calculate the tax bill, multiply the assessed value by the tax rate: $43,500 × 0.04 =
$1,740.00. Remember that tax rates are expressed as a percentage, so 4% equals 0.04 in decimal form.
The assessed value is the value placed on the property by the county assessor for tax purposes.
QUESTION 3
Arizona's homestead exemption protects homeowners from general creditors up to what amount?
1) $100,000
2) $150,000
3) $200,000
4) $250,000
Correct Answer: 2) $150,000
Rationale: Arizona Revised Statutes § 33-1101 provides that the homestead exemption protects up to
$150,000 of equity in a homeowner's primary residence from general creditors. This means that if a
homeowner faces a judgment from creditors, up to $150,000 of their home equity is protected from
forced sale to satisfy that judgment. This exemption applies automatically and does not require filing
any paperwork.
QUESTION 4
The government sends Frank a notice stating that his house and neighborhood will be demolished to
build a much-needed water treatment plant. What is the government required to offer Frank in
exchange for condemning his property?
1) just compensation
2) nothing, since it is for the public good
3) whatever Frank asks for
4) whatever they decide is reasonable
Page | 2
,Correct Answer: 1) just compensation
Rationale: The Fifth Amendment to the U.S. Constitution requires the government to provide "just
compensation" when taking private property for public use through eminent domain. Just compensation
is typically the fair market value of the property at the time of the taking. This ensures that property
owners are not unfairly burdened by government actions that benefit the public.
QUESTION 5
Ad Valorem refers to a tax that is
1) based on the assessed value of property
2) charged by the county to transfer a deed when property sells
3) a percentage of a property's sale price
4) a percentage of someone's income
Correct Answer: 1) based on the assessed value of property
Rationale: Ad Valorem is Latin for "according to value." Ad valorem taxes are based on the assessed
value of the property. In real estate, this typically refers to property taxes that are calculated as a
percentage of the property's assessed value. This is different from transfer taxes (which are based on
sale price) or income taxes (which are based on earnings).
QUESTION 6
How long does an Arizona property owner have from the date of the tax lien sale to redeem the lien by
paying the delinquent taxes, the required interest, and any fees?
1) six months
2) one year
3) two years
4) three years
Correct Answer: 4) three years
Rationale: In Arizona, property owners have a three-year redemption period from the date of the tax
lien sale to redeem their property. During this period, the owner can pay the delinquent taxes plus
interest and fees to reclaim the property. If the property is not redeemed within three years, the
purchaser of the tax lien can apply for a tax deed, which transfers ownership of the property.
Page | 3
, QUESTION 7
What is the legal proceeding that establishes the validity of a will?
1) inchoate
2) partition
3) probate
4) severalty
Correct Answer: 3) probate
Rationale: Probate is the legal process through which a will is validated, the deceased person's debts are
paid, and the remaining assets are distributed to the heirs or beneficiaries. Inchoate refers to an
incomplete or unperfected right. Partition is a legal action to divide property among co-owners.
Severalty refers to sole ownership of property.
QUESTION 8
Penny formed a joint tenancy with Samuel. Penny is married to Ralph. Penny dies, and one week later
Samuel dies. Who owns the property?
1) Ralph
2) Penny's heirs
3) Samuel's heirs
4) Ralph's heirs
Correct Answer: 3) Samuel's heirs
Rationale: In joint tenancy with right of survivorship, when one joint tenant dies, their interest passes
automatically to the surviving joint tenant(s), not to their heirs. When Penny died, her interest passed to
Samuel, making Samuel the sole owner. When Samuel then died one week later, his interest passed to
his heirs through his estate. Ralph, as Penny's spouse, has no claim because the property passed outside
of probate through survivorship.
QUESTION 9
A seller wants to net $153,400 after paying a 7% commission and after paying 4% closing costs. What
must the minimum sales price be?
1) $136,526
2) $170,274
3) $171,544.07
4) $172,359.55
Page | 4
contains 450 practice questions designed to mirror the actual exam format and difficulty. The Arizona
real estate exam is a critical step toward obtaining your license and beginning your career in one of the
nation's fastest-growing real estate markets. The exam tests your knowledge of both national real estate
principles and Arizona-specific laws, including agency relationships, contracts, property rights, financing,
valuation, fair housing, and ethics. This practice test bank provides detailed rationales for every answer,
helping you understand the "why" behind each concept. Use these questions to identify your strengths
and weaknesses, build confidence, and ensure you are fully prepared to pass the exam on your first
attempt. Success requires dedicated study, understanding of Arizona statutes, and mastery of real
estate math and vocabulary. Good luck on your journey to becoming a licensed Arizona real estate
professional!
QUESTION 1
Which method of ownership is NOT legal in Arizona?
1) joint tenancy WROS
2) severalty
3) tenancy by the entirety
4) tenants in common
Correct Answer: 3) tenancy by the entirety
Rationale: Tenancy by the entirety is a form of ownership that is only available to married couples in
some states, but Arizona does not recognize this form of co-ownership. Arizona allows joint tenancy
with right of survivorship, severalty (sole ownership), and tenants in common. The key distinction is that
Arizona is a community property state, and tenancy by the entirety conflicts with community property
laws.
Page | 1
,QUESTION 2
Tim's Arizona City Residential property has an assessed value of $43,500 and the tax rate is 4%. What is
Tim's tax bill?
1) $919.50
2) $1,087.50
3) $1,740.00
4) $3,480.00
Correct Answer: 3) $1,740.00
Rationale: To calculate the tax bill, multiply the assessed value by the tax rate: $43,500 × 0.04 =
$1,740.00. Remember that tax rates are expressed as a percentage, so 4% equals 0.04 in decimal form.
The assessed value is the value placed on the property by the county assessor for tax purposes.
QUESTION 3
Arizona's homestead exemption protects homeowners from general creditors up to what amount?
1) $100,000
2) $150,000
3) $200,000
4) $250,000
Correct Answer: 2) $150,000
Rationale: Arizona Revised Statutes § 33-1101 provides that the homestead exemption protects up to
$150,000 of equity in a homeowner's primary residence from general creditors. This means that if a
homeowner faces a judgment from creditors, up to $150,000 of their home equity is protected from
forced sale to satisfy that judgment. This exemption applies automatically and does not require filing
any paperwork.
QUESTION 4
The government sends Frank a notice stating that his house and neighborhood will be demolished to
build a much-needed water treatment plant. What is the government required to offer Frank in
exchange for condemning his property?
1) just compensation
2) nothing, since it is for the public good
3) whatever Frank asks for
4) whatever they decide is reasonable
Page | 2
,Correct Answer: 1) just compensation
Rationale: The Fifth Amendment to the U.S. Constitution requires the government to provide "just
compensation" when taking private property for public use through eminent domain. Just compensation
is typically the fair market value of the property at the time of the taking. This ensures that property
owners are not unfairly burdened by government actions that benefit the public.
QUESTION 5
Ad Valorem refers to a tax that is
1) based on the assessed value of property
2) charged by the county to transfer a deed when property sells
3) a percentage of a property's sale price
4) a percentage of someone's income
Correct Answer: 1) based on the assessed value of property
Rationale: Ad Valorem is Latin for "according to value." Ad valorem taxes are based on the assessed
value of the property. In real estate, this typically refers to property taxes that are calculated as a
percentage of the property's assessed value. This is different from transfer taxes (which are based on
sale price) or income taxes (which are based on earnings).
QUESTION 6
How long does an Arizona property owner have from the date of the tax lien sale to redeem the lien by
paying the delinquent taxes, the required interest, and any fees?
1) six months
2) one year
3) two years
4) three years
Correct Answer: 4) three years
Rationale: In Arizona, property owners have a three-year redemption period from the date of the tax
lien sale to redeem their property. During this period, the owner can pay the delinquent taxes plus
interest and fees to reclaim the property. If the property is not redeemed within three years, the
purchaser of the tax lien can apply for a tax deed, which transfers ownership of the property.
Page | 3
, QUESTION 7
What is the legal proceeding that establishes the validity of a will?
1) inchoate
2) partition
3) probate
4) severalty
Correct Answer: 3) probate
Rationale: Probate is the legal process through which a will is validated, the deceased person's debts are
paid, and the remaining assets are distributed to the heirs or beneficiaries. Inchoate refers to an
incomplete or unperfected right. Partition is a legal action to divide property among co-owners.
Severalty refers to sole ownership of property.
QUESTION 8
Penny formed a joint tenancy with Samuel. Penny is married to Ralph. Penny dies, and one week later
Samuel dies. Who owns the property?
1) Ralph
2) Penny's heirs
3) Samuel's heirs
4) Ralph's heirs
Correct Answer: 3) Samuel's heirs
Rationale: In joint tenancy with right of survivorship, when one joint tenant dies, their interest passes
automatically to the surviving joint tenant(s), not to their heirs. When Penny died, her interest passed to
Samuel, making Samuel the sole owner. When Samuel then died one week later, his interest passed to
his heirs through his estate. Ralph, as Penny's spouse, has no claim because the property passed outside
of probate through survivorship.
QUESTION 9
A seller wants to net $153,400 after paying a 7% commission and after paying 4% closing costs. What
must the minimum sales price be?
1) $136,526
2) $170,274
3) $171,544.07
4) $172,359.55
Page | 4
